2020 Daily Tech News Show


1			TITLE: Antitrust or Just Antitrustworthy?	Guest:

2			Stories subject to change up until showtime
3			Coming up on DTNS What's next for big tech after the big hearings on the hill, Qualcomm tips an iPhone delay, and The Weeknd heads to TikTok for a virtual concert	Twitch Chat
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5			Today's date
6			This is the Daily Tech News for... Thursday July 30th, 2020. In LA, I'm Tom Merritt
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8			From Studio Redwood, I'm Sarah Lane
9			Justin Robert Young
10			And I'm the show's Producer Roger Chang
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13			Get the wider conversation on our expanded show, Good Day Internet by becoming a member at patreon.com/dtns.
14	:31	TM	Let's start with a few tech things you should know...
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16			Quick Hits
17		sl	The messaging app Telegram filed an antitrust complaint against Apple to the EU, stating that the revenue generated from Apple's 30% commission on in-app purchases greatly exceeds its costs to host and review apps. The complaint also alleges that Apple's App Store policies hault innovation, with Telegram's plans to launch a gaming platform in 2016 scrapped after it was told it violated Apple's policies. Spotify and Rakuten have also recently filed antitrust complaints against Apple with the EU.	https://techcrunch.com/2020/07/30/telegram-hits-out-at-apples-app-store-tax-in-latest-eu-antitrust-complaint/
18		jry	Microsoft announced its new Flight Simulator will come to Steam on August 18 and will also support the HP Reverb G2 VR headset when it’s released this fall. Steam pre-orders for the Standard, Deluxe, and Premium Deluxe editions of Microsoft Flight Simulator are open now.	https://www.thurrott.com/games/238466/microsoft-flight-simulator-is-coming-to-steam-will-support-vr?utm_source=feedly&utm_medium=rss&utm_campaign=microsoft-flight-simulator-is-coming-to-steam-will-support-vr
19		tm	Verizon announced its 4G LTE wireless network is now available in Savannah, Ga., Springfield, Mo., and Tri Cities, Tenn., Va., and Ky with download speeds of up to 50 megabits per second for $60 per month or $40 if the customer is a Verizon wireless subscriber.	https://fortune.com/2020/07/30/verizon-rural-internet-service-4g-lte/
20		sl	Razer released the BlackShark V2 gaming headset for $100 and the BlackShark V2 X gaming headset for $60. The V2 X includes Razer's TriForce 50mm drivers and 7.1 surround sound, has a 3.5mm jack, Razer's HyperClear Cardioid Mic, and advanced passive noise cancellation. The V2 has titanium-coated 50mm drivers, THX spatial audio, and a removable mic. It also connects to a USB sound card for more advanced controls. Razer will also release THX Game Profiles through Razer Synapse on August 6th, only compatible with the Blackshark V2 X for now.	https://www.engadget.com/razer-blackshark-v2-headset-150032670.html
21		jry	Twitch announced it's partnering with Cxmmunity, an organization that supports minorities in esports and the video game industry, to create a "Historically Black Colleges and Universities" esports league. HBCU students will receive educational and scholarship support from Twitch Student to expand their esports programs, along with other objectives.	https://www.engadget.com/twitch-nonprofit-hbcu-esports-league-140016892.html
22		tm	Google posted a page in its online store promoting a phone coming August 3. The expectation is the Pixel 4A will go on sale then. The 4A is expected to be a more affordable version fo the Pixel 4.	https://www.theverge.com/2020/7/30/21348360/google-pixel-4a-release-date-teaser-announcement
23		sl	For the first time ever Apple, Amazon, Alphabet and Facebook are reporting earnings all on the same day. We'll break down the full announcements on Friday's show but here's what we know so far. Amazon's Q2 net sales increased 40% to $88.9 billion in the second quarter, compared with $63.4 billion in second quarter 2019. After CEO Jeff Bezos warned three months ago that Covid might lead to a $1.5bn loss in Q2, net income instead increased to $5.2 billion in the second quarter, compared with net income of $2.6 billion, in Q2 2019.	https://www.reuters.com/article/us-usa-stocks-tech-idUSKCN24V1TX
24			Apple smashes Q3 earnings estimates, reporting $59.7 billion in revenue (up 11%), $26.4b for iPhone, $13.2b for services, $6.5 billion for other products, $6.6 billion for iPad, $7.1 billion for Mac.
25			Alphabet reports its first decline in revenue of $38.30 billion in revenue but beating estimates. There was gradual improvement in ads and strong growth in Google cloud.	https://www.cnbc.com/2020/07/30/alphabet-googl-earnings-q2-2020.html
26			Facebook reported its slowest revenue growth since 2012 at 11% but still beat estimates.	https://www.cnbc.com/2020/07/30/facebook-fb-earnings-q2-2020.html
27			Let's talk a little more about...
28	:36	tm	During its earnings report Qualcomm announced it has reached a licensing settlement with Huawei. The Chinese phone maker will pay Qualcomm a catch-up payment of $1.8 billion. Huawei is barred by US trade restrictions from buying Qualcomm chips but it pays Qualcomm licensing fees for wireless technology. Qualcomm also forecast its next quarter revenue slightly lower than expected due to “a partial impact from the delay of a global 5G flagship phone launch.” Qualcomm told Reuters it is a slight delay that pushes some of the units out from the quarter that ends in September to the quarter ending in December. Coincidentally rumors are circulating that Apple might release its 5G iPhone in October instead of September because of some production slowdown. Also coincidentally, Qualcomm supplies 5G modems to Apple. Huh.	https://www.reuters.com/article/us-qualcomm-results-idUSKCN24U323
29			--	https://www.theverge.com/2020/7/29/21347232/qualcomm-iphone-delay-hint-rumor-q3-2020-earnings-5g
30	:40	sl	Canalys estimates that Huawei shipped the most smartphones worldwide in Q2, the first time in 9 years that neither Samsung or Apple led the market. Huawei's shipments were down 5% on the year to 55.8 million devices, but down less than Samsung which dropped 30% on the year. Huawei shipped 70% of its devices in mainland China, up 8% on the year, while overseas shipments declined 27%.	https://www.cnet.com/news/huawei-takes-samsungs-crown-to-become-worlds-biggest-phone-maker-analyst-says/#ftag=CAD590a51e
31	:43	jry	BUT Samsung posted better than expected earnings all he same. Operating profit was up 23 percent on the year despite a 6 percent fall in revenue. Samsung put it down to optimizing expenditures. Smartphone sales were down from last year. Display sales fell but the earnings were boosted by a $924 million compensatory payment from Apple which ordered fewer iPhone displays than expected. Samsung's chip business is mixed with DRAM and SSD demand up for PCs and data centers but down for mobile devices. The chip division still accounted for 2/3 of Samsung's operating profit.	https://www.theverge.com/2020/7/29/21347663/samsung-q2-earnings-covid-19-coronavirus
32	:46	sl	Mark your calendars. August 7 at 8:30 PM eastern The Weeknd will perform a virtual concert of tracks from his latest album After Hours... no not in Fortnite... in Tik Tok. The Weeknd will be represented by a digital avatar that viewers can interact with as he performs. A company called Wave is handling the tech. They previously put John Legend and Lindsey Sterling in mo-cap suits for similar virtual performances. The show will raise money for the Equal Justice Initiative. Interested fans need to RSVP at wave.watch/theweekndontiktok.	https://www.theverge.com/2020/7/30/21347803/tiktok-the-weeknd-virtual-concert-date-time-wave-cross-reality
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37			Main
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39	:48		What happens next to big tech after the Congressional hearings
40			Apple, Amazon, Facebook, Google internal emails released by Congress	https://www.cnbc.com/2020/07/30/apple-amazon-facebook-google-internal-emails-released-by-congress.html
41			‘Instagram can hurt us’: Mark Zuckerberg emails outline plan to neutralize competitors - The Verge	https://www.theverge.com/2020/7/29/21345723/facebook-instagram-documents-emails-mark-zuckerberg-kevin-systrom-hearing
42			Apple tried to lure Amazon video app with lower 15% fee: Eddy Cue email	https://www.cnbc.com/2020/07/29/apple-tried-to-lure-amazon-video-app-with-lower-15percent-fee-eddy-cue-email.html
43			A few of the big questions Big Tech CEOs didn’t answer - Protocol	https://www.protocol.com/some-questions-big-tech-ceos-refused-to-answer
44			Democrats just made their case against Big Tech. Here’s what comes next. - Protocol	https://www.protocol.com/big-tech-ceo-hearing-what-comes-next
45			Big Tech's antitrust hearing is over. Now the real action starts - CNET	https://www.cnet.com/news/big-techs-antitrust-hearing-is-over-now-the-real-action-starts/#ftag=CAD590a51e
46			Emails on right to repair from within Apple	https://www.theverge.com/2020/7/30/21348240/apple-right-to-repair-legislation-antitrust-investigation-policy
47	:50		Buying a Comeptitor	https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/single-firm-conduct
48	:52		Predatory Pricing	https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/single-firm-conduct/predatory-or-below-cost
49	:55		Refusal to Deal	https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/single-firm-conduct/refusal-deal
50			Yesterday the CEOs of Amazon, Apple, Alphabet, and Facebook sat for five hours and answered or didn't, questions from the US House subcommittee on antitrust about anticompetitive practice and anti-conservative bias. Yesterday we talked about how what they said didn't seem to have much material impact but we pointed out that the investigation was already underway and while the hearing itself might not change much the investigation wasn't going to stop. So today let's talk about what happens next. The committee gathered more than 1.3 million documents on all four companies in advance of the hearing. 385 hours of calls meetings and briefs. There's some headline grabbers. Here's how some examples apply to antirust law	BUYING A COMPETITOR It's not illegal. (HP and Compaq, Sprint and T-Mobile) The law is violated only if the company tries to maintain or acquire a monopoly through unreasonable methods. For the courts, a key factor in determining what is unreasonable is whether the practice has a legitimate business justification. - Facebook emails between Zuckerberg and CFO David Ebersman. acquiring Instagram would help “neutralize a potential competitor. Ebersman: “I would ask you to find a compelling elucidation of what you are trying to accomplish.” Zuckerberg: “One way of looking at this is that what we’re really buying is time. Even if some new competitors springs up, buying Instagram, Path, Foursquare, etc now will give us a year or more to integrate their dynamics before anyone can get close to their scale again. Within that time, if we incorporate the social mechanics they were using, those new products won’t get much traction since we’ll already have their mechanics deployed at scale.” 45 minutes later “I didn’t mean to imply that we’d be buying them to prevent them from competing with us in any way,” he wrote." In an email to an employee congratulating the acquisition of Instagram “One reason people underestimate the importance of watching Google is that we can likely just always buy any competitive startups. But it’ll be a while before we can buy Google.”
51			PREDATORY PRICING Consumers are harmed only if below-cost pricing allows a dominant competitor to knock its rivals out of the market and then raise prices to above-market levels for a substantial time. -- Although the FTC examines claims of predatory pricing carefully, courts, including the Supreme Court, have been skeptical of such claims. - Amazon emails saying they needed to match pricing on Quidsi's diapers and soap stores "no matter what the cost" Amazon later bought Quidsi and shut it down seven years after it was acquired. - Amazon prices Echos below market.	REFUSAL TO DEAL If the monopolist has done business with the competitor and then stops, the monopolist needs a legitimate business reason for its policies. Courts will continue to develop the law in this area. Anecodtes of sellers who rack up big sales on Amazon only to have Amazon introduce a competing product and see their sales fall to zero. PopSockets accusing Amazon of flooding the platform with counterfeits then telling Popsockets to buy ads fi they wanted them dealt with Amazon launching competition products based on internal data or after meeting with startups about investing.
52			WHAT NEXT The Department of Justice (apple/Google), The FTC (Amazon/Facebook) and a group of state attorneys general are all investigating all four companies. They can use any of the public information from the committee's investigation. Though DoJ and FTC reportedly fight over dividing the investigation with DoJ doing some Facebook investigating. 47 state AGs bringing case against Facebook. 50 state AGs bringing case against Google. Attorney General William Barr expects a case against Google this summer over search and advertising. The FTC can issue fines in limited cases and order structural changes. (Divest. Business, provide platform access, limit acquisitions) The committee will issue a report later this year laying out findings, some expect it as soon as August. That will likely be used to suggest new legislation. New laws would focus on the idea of data and attention being defined as important as money spent. Something not contemplated in existing antitrust laws which weigh lower prices very heavily in determining antitrust.
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59	:58		Mailbag (feedback@dailytechnewsshow.com)
60			Dan had more thoughts on our conversation with Andy Inahtko on Monday's show The entire vibe I get from the production of MLB thus far this season (and sports in general in a post-COVID world) is making the best of a bad situation. Baseball without fans is just weird, and I imagine that the crowd noise (which I actually don't mind) and fake fans (which, in the form of cardboard cutouts, are charming) are just attempts to make baseball feel more normal. As far as whether owners will continue to do this after the crisis, I'm not sure I see what the incentive would be. Fan attendance seems to be driven primarily by the performance of the team on the field - if your team is terrible, fans won't pay to show up (or even watch on TV). Long story short: Seeing a large crowd at the park isn't enough to get people to show up in my opinion, so I don't know that we'll see this once this crisis is over. --Dan
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79		tm	Plug tomorrow's guest: Lamarr Wilson	Good Night Rob
80			END OF SHOW
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